Blas v. State, Supreme Court No. S-15154

CourtSupreme Court of Alaska (US)
Writing for the CourtSTOWERS, Justice.
Docket NumberNo. 6937,Supreme Court No. S-15154,6937
Decision Date08 August 2014

LEO BLAS, Appellant,

Supreme Court No. S-15154
No. 6937


August 8, 2014

Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER. Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email

Superior Court No. 3AN-12-08710 CI


Appeal from the Superior Court of the State of Alaska, Third Judicial District, Anchorage, Kevin M. Saxby, Judge.

Appearances: Leo Blas, pro se, Chugiak, Appellant. Aesha Pallesen, Assistant Attorney General, Anchorage, and Michael C. Geraghty, Attorney General, Juneau, for Appellee.

Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and Bolger, Justices.

STOWERS, Justice.


The Department of Labor and Workforce Development, Division of Employment Security (the Division) determined that Leo Blas committed fraud when he

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failed to report that he worked and traveled during weeks he claimed and received unemployment benefits. Blas presented no contrary evidence disputing these findings and this conclusion. We affirm the superior court's decision to uphold the Division's decision to reduce and deny Blas's receipt of unemployment benefits and to disqualify him from receiving benefits for 52 weeks.


A. Facts

Leo Blas is a highly educated accountant by profession; he also trained and worked as a life insurance agent. Blas collected unemployment benefits on and off for several years through the Division under the Alaska Employment Security Act.1 On March 17, 2010, the Division's Benefit Payment Control Unit issued a determination of disqualification to Blas based on his failure to report work and travel while he was unemployed and receiving unemployment benefits. On February 16, 2011, a Division Appeal Tribunal partially reversed this determination, but held that "the facts reveal . . . [Blas withheld] material information about . . . one week of travel and two weeks of employment in November 2009" and "did so with the intent to receive unentitled benefits during those three weeks."2

This appeal concerns Blas's alleged failure to report work and travel in 2011 and 2012. Blas applied for unemployment benefits in 2011 for the weeks ending July 16, July 23, August 13, August 20, September 3, September 10, September 17, November 26, December 3, December 10, December 17, December 24, and

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December 31. He also applied for benefits in 2012 for the weeks ending January 14 and January 21. During these weeks, Blas worked for Vision Alaska I, LLC, d/b/a Coastal Television Broadcasting Company, as a contract and then salaried employee, and then at Harley's Auto Park as a salaried employee. Although required to report travel to the Division when filing for benefits, Blas traveled to Moscow, Idaho and back to Anchorage on November 22-23, 2011, and did not report it.

B. Proceedings

The Division commenced two proceedings against Blas.3

1. The first proceeding

On April 16, 2012, the Division's Benefit Payment Control Unit issued a notice of determination to Blas because employer records showed that he had earnings during 13 weeks he had received unemployment benefits.4 This determination relied on a recorded, in-person interview with Blas where he admitted that he began working as an accounting clerk on a contract basis for Coastal Television in July 2011. Blas also admitted that he became a salaried employee of Coastal Television on July 28, 2011. Blas also agreed that he became a salaried employee of Harley's Auto Park on December 1, 2011. The determination stated: "You reviewed the . . . [previous] decision from the Appeals Tribunal . . . issued [February 16, 2011] in [your] case. You agreed that you were advised . . . that you must report your work and earnings whether you had

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been paid or not." Blas disputed that the previous February 16, 2011 decision of the Appeal Tribunal found him to have fraudulently applied for benefits in 2010.

When asked why he answered "no" to the question "Did you work for any employer?" on his online weekly certifications seeking unemployment benefits, Blas answered that he had received a letter from the Division that informed him he was owed Emergency Unemployment Compensation benefits for 2007, and he declined to report his work and earnings because he was underpaid and "the Division owed him money." Blas was then asked whether he knew that, by answering "no," he was certifying to false information. Blas stated that he was "not sure." Blas also stated that after the Division deducted the amount of the Emergency Unemployment Compensation benefits he was owed, he would be willing to make payments on the balance of unentitled benefits he received.

The Division's determination concluded that "[Blas] knew [he was] required to report [his] work and earnings and [he] failed to do so; misrepresentation has been established." The determination denied Blas benefits under AS 23.20.3875 in 2011

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and reduced his benefits under AS 23.20.3606 in 2011 for the weeks ending August 13, August 20, September 3, September 10, December 3, December 10, December 17, December 24, December 31, and in 2012 for the weeks ending January 14 and January 21. It also denied Blas benefits under AS 23.20.387 in 2011 for the weeks ending July 16 and July 23. The determination found that, because

[Blas] had [previously been] disqualified for misrepresentation within the past five (5) years (03/[17]/10), [he was] automatically DENIED future benefits under the provisions of AS 23.20.387 and 8 AAC 85.380(c)7 for fifty-two (52) weeks beginning with the week ending 04/14/12 through 04/06/13.

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Finally, the determination concluded that Blas was subject to any applicable overpayment debt and penalty amount under AS 23.20.390(a).8 Blas appealed this determination.

In the Appeal Tribunal hearing, Blas did not dispute that he had worked for the weeks reported in the determination. In fact, he offered to "start making payments" and to "make a payment plan" for any excess he might owe. Instead, Blas argued that: (1) an administrative subpoena issued by the Division investigator in his case to access his bank records violated his right to privacy; (2) he was entitled to a calculation of damages he owed if he was being accused of fraud; (3) the previous February 16, 2011 Appeal Tribunal decision did not find that he had committed fraud in his 2010 application for benefits, and the Division erred in its 2012 determination by concluding that he had previously committed fraud when it automatically denied him 52 weeks of unemployment benefits; (4) the Division investigator called his last employer and caused him to lose his job; and (5) the Division did not provide him with discovery that he requested, including a recording of the phone call that caused his loss of employment, and a "second investigator's report" that Blas alleged aimed to uncover the circumstances of his termination.9

The Appeal Tribunal affirmed the Division's April 16, 2012 determination and denied Blas benefits in 2011 for the weeks ending July 16, July 23, August 13 though September 10, as well as December 3, 2011 through January 21, 2012 "and for

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the future weeks of April 14, 2012 through April 6, 2013."10 The Tribunal also upheld the Division's determination of overpayment liability under AS 23.20.390(a), which included penalties. It remanded to the Division the issue of Blas's eligibility for benefits during the week ending September 17, 2011, and ordered a recalculation of any penalty Blas owed.

Blas appealed the Appeal Tribunal's decision to the Commissioner. The Commissioner issued a decision that affirmed the Appeal Tribunal in all respects, concluding that Blas "clearly committed fraud for a protracted period by giving false information on his claim certifications in spite of . . . [being] disqualified for failing to fill out the claim forms properly in a previous claim year," and that Blas gave "no explanation as to why he filed the claims" and instead "cavalierly gave testimony in the hearing to the effect that if he had been paid any weeks that he was not entitled to that he would pay it back." The Commissioner noted that the Appeal Tribunal decision "did not rely on any bank records that the [D]ivision may have obtained by subpoena" and even if it did, "the [D]epartment is not in the position to interpret the constitutionality of statutes it is mandated to enforce."

2. The second proceeding

On June 5, 2012, the Division's Benefit Payment Control Unit issued a second notice of determination to Blas, finding that Blas failed to report earnings for the week ending September 17, 2011, and failed to report travel for time he was in Idaho during the week ending November 26, 2011.11 The determination concluded that Blas

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"made false statements with the intent to obtain benefits [he was] not entitled to receive," denied him benefits for the weeks ending...

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